Thai manufacturing surges to fastest growth in 29 months

Production reaches nearly two-and-a-half-year high as domestic demand drives sharp expansion, though export orders remain subdued

Thailand's manufacturing sector recorded its strongest performance since May 2023 in October, driven by a sharp rise in domestic demand that sent production soaring and backlogs accumulating at a record pace.

The S&P Global Thailand Manufacturing Purchasing Managers' Index climbed to 56.6 in October, up from 54.6 in September, marking the sixth consecutive month of expansion. The reading signalled the sharpest improvement in manufacturing conditions in 29 months.

Central to the acceleration was a surge in new business inflows, with incoming orders rising at the steepest rate in two-and-a-half years. Manufacturers reported successful business development and rising client interest as key drivers of the growth.

## Record backlogs as firms struggle to keep pace

The strength of demand proved so robust that factories struggled to keep up, with backlogs of work accumulating at a survey record pace despite firms ramping up production and hiring additional workers.

Thai manufacturers raised their workforce capacity for the second consecutive month to cope with rising workloads, whilst production growth accelerated for a seventh successive month. Output rose at the quickest pace in nearly two-and-a-half years.

Jingyi Pan, economics associate director at S&P Global Market Intelligence, said: "October's PMI data indicated that Thailand's manufacturing sector further improved at the start of the final quarter of 2025. Notably, manufacturing output rose at the quickest pace in nearly two-and-a-half years, driven by robust domestic demand."

The domestic surge came despite continued weakness in external markets. New export orders fell for another month, though the pace of decline was softer than in September and only marginal.

Ms Pan noted it was "positive to see the pace of reduction easing in the latest survey period," suggesting some potential stabilisation in overseas demand.

To help fulfil orders, stocks of finished goods were depleted for a fifth straight month. Rising production requirements also led to an expansion in purchasing activity during October.

Despite solid growth in buying activity, stocks of purchases continued to decline, attributed to both high utilisation of input products for production and delays in shipments. Lead times lengthened again in October, pointing to renewed pressure on supply chains.

After three consecutive months of decline, average input costs stabilised at the start of the final quarter. In response, Thai manufacturers opted to keep their selling prices unchanged, providing relief from earlier inflationary pressures.

Looking ahead, overall sentiment in the Thai manufacturing sector improved markedly. Business confidence rose to its highest level in two-and-a-half years amid hopes for business expansion plans and better economic conditions to drive sales over the coming year.

Ms Pan said forward-looking indicators continued to present "a positive picture for near-term output growth," noting that the record expansion in backlogs coupled with improved optimism "all suggest that the Thai manufacturing sector remain on track for growth in the coming months."